The biotechnology sector in India will achieve a revenue of $11.6 billion in 2017, growing at a CAGR of 22%, according to a recent report from Ernst & Young. The key growth drivers of the $4.3 billion industry include strong domestic demand for biotech products, growth in contract services, focus on R&D initiatives and strong government support for the sector, the report - 'Beyond Borders'said.
Industry comprises of five sub segments, out of which Bio-pharma leads with a revenue share of 62%, followed by bio-services 18% and the bio-agri division with a share of 15% during 2012.
The global biotechnology industry continued on a path of recovery in 2012 as public companies in the sector achieved top- and bottom-line growth for the third straight year even while R&D spending remained under pressure at many companies.
Hitesh Sharma, National Leader - Life Sciences, Ernst & Young said, “In this environment, it is likely that there would be constraints that the global biotech players may face, driving them to look at more optimal avenues. India provides cost advantages in drug discovery and development and will sustain its competitiveness as compared to other high-cost locations.
R&D spending by public companies has grown by 5%, well below the 9% growth rate achieved in 2011. While expenditures remained strong at commercial leaders, pre-commercial entities substantially reduced R&D spending, the report said.
"Therefore, pressure on global biotech players could result in them getting into arrangements or partnerships with Indian companies to leverage the cost advantage and technical expertise to optimize their R&D spend effectively," Sharma added.
